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Newbie to Algo Trading and Quant. I was wondering if anyone could explain these charts to me

Also, I did another backtest and ended up getting -1000000000 percent. I am not really sure how this happens(could it be short postions) I thought that maybe leverage was responsible for this. When I set it to 1 and the percent returns went up by x100. In the backtest shown, the leverage is changing but if you set it to 1 then you will see. I want to include another backtest of the algo, but I don't know how to do that. If anyone could explain the results of the backtest to me, it would help alot.

3 responses

This is the other backtest. It has leverage set to one.

Click margin to set breakpoint and examine values before, and after

    normalized_weights = raw_weights.div(raw_weights.sum())  

Thank you, Blue. That fixed the algo.